Daily Snapshot: Inflation outpaces allowance | Expert Briefing

More “good” news for SCIs at the end of HSJ editorial earlier this week – they are about to start life as statutory organizations with a budget cut in real terms.

Analysis of the allocations published by NHS England shows that an average increase in spending of 3.3% for systems will be exceeded by public sector inflation, which is expected to be at 4%.

Economists fear the outlook will only get worse, as the 4% inflation rate forecast for utilities – different from the better-known consumer price index which currently stands at 8% – under- almost certainly estimates the real impact of rising costs on a health service.

Against this backdrop, NHS England’s base budget is still expected to exceed the rate of inflation, raising questions about where this extra money is going. Various people suspect the regulator is withholding some to fill future gaps in budgets, although the NHSE reports additional investment in other priorities not covered by core budgets.

Either way, the system’s finance bosses would have an extra £1.3bn at stake if their base budgets grew at the same rate as those of the NHSE.

The mystery of the Messenger

The most ‘thorough’ examination of NHS management since the late Sir Roy Griffiths’ report nearly four decades ago may not be the management-bashing exercise it was meant to be.

Last October, it was announced that the former Deputy Chief of the Defense Staff, General Sir Gordon Messenger, would lead the investigation and deliver his findings in “early 2022”.

While early newspaper briefings gave a negative view of what was to come, such as hospital managers being fired for not clearing waiting lists fast enough, HSJ understands that these messages were not in his submissions.

According to high-level sources, General Sir Gordon believes NHS management and leadership is strongly ‘task-oriented’, with too much emphasis on getting things done rather than how.

Another finding was that leaders were deterred from entering contested trusts and better ‘support sets’ were needed to encourage the best health services to work there.

The government has postponed publication of the review until after local elections in May, but it is expected to be followed by an implementation program of its findings.

However, its final conclusions are not yet certain, nor is the capacity in which General Sir Gordon will be involved during his second phase.